Understanding Shopify Pricing

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A Shopify Pricing Guide for Optimizing Shopify Costs for Brick-and-Mortar Retailers

Shopify is the leading ecommerce platform that allows brick-and-mortar retailers to easily sell their inventory online, to expand reach beyond a store location. Understanding Shopify pricing is crucial to ensure you’re not overspending while getting the most value from your investment.

How I Learned the Hard Way About Shopify Pricing

I learned the hard way that Shopify pricing isn't always what it seems. When I transitioned from WordPress to Shopify for my wife's two retail stores, I did what most business owners do—I hired a Shopify expert. He placed our sites on the most expensive plan, added several apps with high monthly fees, and for the first year, we overpaid without even realizing it. It turns out, he was earning a commission on the overpayment, and we weren’t even using half the features we were paying for.

How I Lowered Our Shopify Costs

Once I started learning the ins and outs of Shopify, I took control. I adjusted our plan, removed unnecessary apps, and cut our costs substantially. Shopify can be a really economical option—provided you're using the right plan for your business.

This Guide Will Help You Navigate Shopify Pricing

In this guide, I’m going to show you how to navigate Shopify pricing with your eyes open. Whether you're just starting out or thinking about scaling up, I’ll help you find the plan that truly fits your business needs—without the extras you don’t need.

A Proven Approach for Shopify Pricing

Start Simple with Shopify's Starter Plan: Shopify Basic

Shopify pricing is straightforward. Whether you're launching your ecommerce business or upgrading your existing website, it’s a cost-effective ecommerce website builder. The Shopify Starter plan (called Shopify Basic) is the entry-level Shopify subscription that offers an ecommerce platform option to quickly launch and test an ecommerce business idea.

Choosing Between the Annual or Monthly Shopify Billing Options

Shopify pricing for an annual plan offers cost savings compared to paying monthly. However, you can switch to annual at any time, so if you’re still testing Shopify or are tight on cash, it’s best to start with a monthly plan.

Set a reminder to review your billing option after a few months. Once you’re confident in your profit margins and the longevity of your ecommerce store, make the switch to annual to save some money.

Take Advantage of Advanced Shopify Plans When It's Time

Once you're ready to expand your Shopify account beyond the basic Shopify plan to more advanced features, then there are many ecommerce builder options baked into Shopify stores that'll allow Shopify merchants to fit Shopify their vision of their own online store.

Note: Shopify also offers a Starter plan as well as a Plus plan for enterprise-level businesses, neither of which I discuss here because they are rarely useful to small businesses like the ones I work with. Before committing to a paid plan, Shopify will allow you test the platform's features and functionality with promo such as a 3-day free trial or $1 for 30-day deal.

How Does Shopify Pricing Work?

Shopify fees offer a monthly or annual payment structure. There are no setup fees for Shopify plans, so getting started is low risk.

What's Included In My Shopify Pricing Plan?

With just the Basic plan, you can have a fully functional online store for a low monthly fee, providing all the essential tools you need to begin selling online without a significant upfront investment.

Understanding what’s included in Shopify pricing plans helps you see the value you’re getting for your monthly fees. Unlike many other ecommerce platforms, Shopify plans include several essential features at no extra cost:

• SSL Certificate: Ensures your online store is secure, protecting customer data and building trust.
• Shopify Payments: The built-in Shopify payment gateway saves you from third party payment provider fees and simplifies transaction management.
• 24/7 Support: Access to Shopify’s customer support anytime you need help.
• Unlimited Products: All Shopify plans allow you to add as many products as you need. (You can have 100,000 products live on the store.)
• Bandwidth: Shopify covers all bandwidth charges, ensuring your online store can handle any amount of traffic.

These features are included in the monthly Shopify cost, making it a cost-effective option for setting up and running your online store.

What's Not Included in Shopify Subscriptions?

While Shopify’s pricing plans cover many essential features, there are additional costs you should be aware of:

• Paid Themes: Although Shopify offers free themes, you might opt for a 3rd party theme which you need to pay for.
• Third-Party Apps: Many Shopify stores rely on apps to enhance functionality, from marketing tools to inventory management. These third-party apps often come with their own subscription fees, which can add up quickly.
• Advanced Shopify Store Customizations: Custom development work, such as specialized features or design changes beyond what themes and apps offer, typically requires hiring a developer.
• Transaction Fees: While using Shopify Payments is included, there are per purchases transaction charges.
• Third-Party Transactions: Using third-party payment gateways (such as PayPal) incurs additional transaction fees from the payment processor in addition to using Shopify Payments.
• Shipping Costs: While Shopify Shipping is included with Shopify plans and offers some shipping discounts, you’ll still need to account for the actual cost of shipping products to your customers.
• Custom Domain: A custom domain name is not included and needs to be purchased separately, either through Shopify or through a domain name regsitrar.
• Shopify Point of Sale: If you'll be selling your products in store or at events and need a point of sale system, the Shopify POS is an extra charge. While all plans include Shopify POS Lite for basic in-person selling, businesses with more complex retail needs may require Shopify POS Pro, which comes at an additional cost.

How Much Does Shopify Cost?

Overview of Shopify Pricing Plans

Shopify offers several pricing plans designed to cater to various business sizes and needs. How much does Shopify cost? Here’s a quick breakdown of Shopify’s pricing plans:

• Shopify Basic Plan (US$39 per month): This plan includes essential features such as an online store, unlimited products, and 24/7 support. Ideal for small businesses just starting out online.
• Shopify Plan (US$105 per month): Adds professional reports, gift cards, and lower credit card fees. Perfect for growing businesses.
• Advanced Plan (US$399 per month): Provides advanced report building, third-party calculated shipping rates, and the lowest transaction fees. Shopify Advanced is best for larger businesses with more complex needs.
• Shopify Plus (Custom pricing starting around $2,300 per month): For large businesses requiring advanced customization and support, Shopify Plus is an option. Where Shopify Plus starts to make sense for small businesses is that it includes up to 10 stores, which comes out to less per month than the Advanced Shopify Plan per store if you want to subdivide your offerings to multiple sales channels in the form of stand alone Shopify websites.

Note: There is a Shopify Lite plan for selling on social media, as well as some free trial promotions, which I won't be covering here. The details quoted in this article are accurate at the time of writing. Check the Shopify website for pricing changes.

Transaction Fees Are Extra

There are 2 types of transaction fees.

Shopify Transaction Fees

Shopify charges a fee per transaction starting at 2.9% of the sale plus 30¢ at the Shopify Basic plan, with lower fees offered as the monthly cost increases.

Third Party Transaction Fees

When using external payment providers instead of Shopify Payments, such as PayPal or Apple Pay, Shopify charges additional transaction fees on each sale. All these fees vary depending on the payment provider and the pricing plan.

While adding additional payment options may make it easier for customers to purchase using their preferred payment method, by using the primary payment methods included in Shopify Payments only, such as Shop Pay, Visa and MasterCard, you can avoid extra transaction fees.

Some credit cards, such as American Express are included in Shopify Payments but also have additional fees.

Choosing the Right Shopify Plan for Your Shopify Store

Start with the lowest cost Shopify Pricing plan and eliminate that first by looking at the options and limitations. If there are features you need that are unavailable in Shopify Basic plan, then consider the Shopify plan and then the Advanced Shopify Plan.

Below are the key criteria that I have seen Shopify store owners use for upgrading their Shopify subscription…

For Calculated 3rd Party Carrier Shipping Options Use Shopify Advanced

Have a great contract with a shipping company? All Shopify Plans offer free shipping, flat-rate shipping, as well as Shopify Shipping which is a calculated shipping option based on the order weight and shipping locations. If you have a contract with special rates with your own carrier, then you'll likely save money if you have all your shipping go through that carrier, in order to maximize volumes and lower your shipping rates. The Shopify Advanced plan offers Calculated 3rd Party Carrier Shipping.

Staff Accounts are Another Factor when Determining the Best Shopify Pricing Plans

Need staff accounts? The number of staff accounts varies by each Shopify plan:

• Shopify Basic plan: the store owner;
• Shopify Plan: the store owner + 5 additional staff accounts;
• Shopify Advanced Plan: the store owner + 15 additional staff accounts.
• Shopify Plus: unlimited staff accounts.

If Your Sales Volume is Substantial, Save Money by Spending More On Your Shopify Plan

Have sales volume? If your online sales volume is high, upgrading to a higher Shopify plan can actually save you money due to lower transaction fees.

• Shopify Basic plan: 2.9% + 30¢;
• Shopify Plan: 2.7% + 30¢;
• Shopify Advanced Plan: 2.4% + 30¢.
• Shopify Plus: Fees are negotiable for Shopify Plus Merchants.

Evaluate your sales Per Month to see if this applies

Per Month Sales Needed To Save On Switching from Basic Shopify to Shopify Plan

If you are basing your Shopify plan upgrade on the cost savings of transaction fees alone, then for you to justify a move from the Basic Shopify starter plan to the Shopify Plan, you'd need to be earning $25,000 per month to fully absorb the additional fees.

Per Month Sales Needed To Save On Switching from Basic Shopify to Advanced Shopify

To justify a move from the Basic Shopify starter plan to the Advanced Shopify Plan, you'd need to be earning $75,000 per month to fully absorb the additional fees.

Cancelling Your Shopify Store

You can cancel your subscription and deactivate your store at any time, but charges for Shopify subscription plans are non-refundable. When canceling, be aware of any outstanding balances from transaction fees, shipping label charges, or app subscriptions. Note that third-party apps with separate billing won't be automatically canceled when deactivating your Shopify store. After deactivation, Shopify retains your store information for 2 years, allowing for potential reactivation if you decide to return to the platform.

Avoid Basic Shopify Mistakes

Maximize Your Shopify Payments Options To Avoid Third-Party Transaction Fees & Extra Credit Card Fees

Use Shopify Payments to cover many of the most common ways people like to pay for online purchases such as Visa & Mastercard, but there are some things to watch out for in terms of reducing transaction fees.

Additional charges for Third-Party Transaction Fees

Third party fees vary by the provider, such as PayPal and Stripe. In addition to the third-party transaction fees, Shopify will charge a fee of between 2% and 0.5% instead of the Shopify transaction fees. When you add the Shopify fee to the third-party fees, it'll cost you more than if the shopper was to use Shopify Payments to make their purchase, so you need to decide what third-party transaction providers you want to work with and what makes it worth the extra cost.

With Shopify Payments, Some Credit Cards Are More Expensive

Just like in-store purchases for small businesses, your Shopify Payments will have additional fees being charged on specific cards. If you prefer not to pay those fees, you can turn those credit cards off.

Ask Your Website Builder to Justify Shopify Subscription Plan & App Charges

It's common for me to open a Shopify site and find the store owner is overpaying for their plan and/or paying for apps that are not being used. Whether your website builder is a staff person or a developer, make sure they are approving charges to your credit card.

Limit Staff Permissions

You can adjust permissions on staff and collaborator account to force your staff to have you approve new app charges.

Ask Your Website Builder for fee Approvals

For developers on new sites, ask them to approve Shopify subscription & app charges before proceeding. It's common for developers to place new clients on Advanced Shopify by default, and to add new apps for each feature request, both of which will result in a surprise in your costs per month when you launch your site.

For example, you might ask a website builder for product bundling and messaging features on your site and the developer says, no problem. They then install bundling & messaging apps that charges $19 per month each. This may be two app of 10 they installed, each that charge per month for use. You don't know this until you start looking at your Shopify fees because they are higher than expected.

Review Your Shopify Apps

Regularly review the apps installed in your Shopify store. Uninstall the ones you are not using. Even the one that are installed in Shopify free, if you're not using any Shopify apps, get rid of them. You can always get them back later.

Free Shopify Themes Versus Paid Shopify Themes

Yes, you can pay for a Shopify Theme, but that doesn't mean you should.

Start with Dawn, the Basic Shopify Theme

Unless you have a good reason to use a paid theme, then just start with Dawn. Shopify’s free Dawn theme is fast, well-designed, and frequently updated. It’s a great starting point for any online store. Using the free Dawn theme can help you keep initial costs low while you get your store off the ground.

Invest in Premium Themes Only When Necessary

If you identify specific needs that the Dawn theme can’t meet, then consider a premium theme. Premium themes range from $140-$450 and offer advanced features to your ecommerce website builder that are not available in the free themes.

Shopify Customizations

I love to do Shopify customizations. That said, customizing Shopify is only a last resort. Stick to the theme’s built-in features as much as possible. Customizations can be costly and complex to maintain. Over-customizing your Shopify store can lead to higher costs and potential performance issues.

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Checklist for Optimizing Your Shopify Pricing

1. Start with the Shopify Starter Plan
   • Launch your online store with the entry-level Shopify Basic plan to establish and test your business idea.
   • Evaluate if the Basic Shopify Starter plan meets your needs before considering an upgrade.
2. Choose Monthly Billing Initially
   • Opt for billing monthly while testing Shopify.
   • Set a reminder to review your billing option after a few months.
   • Switch to annual billing later for cost savings once you're confident in your store's performance.
3. Upgrade to The Shopify or Shopify Advanced Plan When Necessary
   • Move to the Shopify or Advanced Shopify plan if you need more features.
   • Assess your sales volume to determine if upgrading will save on fees.
4. Be Aware of Additional Costs
   • Themes: Start with free themes like Dawn; consider paid themes only when necessary.
   • Apps: Regularly review and remove unused third-party apps to save costs.
   • Customizations: Limit custom development work to essential features that can't be accomplished otherwise.
   • Transaction Fees: Optimize Shopify Payments to minimize credit card and third-party transaction fees.
   • Shipping: Assess the best shipping options to suit your business.
   • Shopify POS: Consider the additional costs of the Shopify POS point of sale system for in-person sales if you need that.
5. Monitor and Adjust Staff and Collaborator Permissions
   • Limit staff accounts to what’s necessary for your business operations.
   • Review and update permissions to control access.
   • Ask for express subscription and app fee approvals before proceeding.
6. Maximize Shopify Payments Options
   • Use Shopify Payments when possible to avoid third-party fees and extra credit card fees.
   • Check the additional fees on specific credit cards and decide if you want to allow customers to use them.

By following this checklist, you can maximize the value per dollar for Shopify pricing plans, control Shopify apps and subscription costs, and understand the features available.